(Business Insider) 'Stagflation-lite': The worst-case scenario for the US economy looks like it's getting more likely

Investors have recently taken in a slew of data points that suggest the economic environment is rolling closer to stagflation — a dreaded scenario where inflation rises while economic growth slows and unemployment spikes.

That situation is thought of as even worse for policymakers to resolve than a typical recession, as high inflation prevents the Federal Reserve from cutting interest rates to spur economic growth.

Stagflation first floated onto Wall Street's radar after President Donald Trump introduced his sweeping array of tariffs on April 2. Tariffs are thought to stoke inflation, as companies are likely to pass along at least part of the cost of import duties by raising prices. Meanwhile, they can slow growth by raising costs for businesses that rely on imported inputs

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